Rental prices for Yangon’s offices have fallen for the second year in
a row and are expected to keep drop­ping in 2017, according to a new
market snapshot by real estate firm Colliers International.

Rates for commercial space fell 18 percent in the last three months
of 2016 compared to the same period in 2015, and are down 33 percent
from 2014 rates, the snapshot said.

Businesses now pay an average of $46
per square meter.

Collier predicted a fur­ther drop of four percent by the end of 2017.
“The sizeable additional sup­ply within the next twelve months will
exert further downward pressure on the citywide rate, albeit at a modest
degree,” the company’s researchers said in the update.

They added that inter­national quality develop­ments “are
continuously taking shape” with the Junction City Office, Crys­tal Tower
and Time City Office Tower projects all due to launch in the near term.

They will contribute to more than 95,000 square metres of leasable
space expected to become avail­able this year. The extra space will mark
a 34 per­cent increase in the total supply of office space, the update
said.

Occupancy rates rose to 61% at the end of 2016, up 16% on the year
be­fore, the figures show. But the percentage of of­fice spaces laying
empty is still higher than at the end of 2015, when occupancy rates were
at their peak.

More than 176,000 square feet of office space is now occupied in
Yan­gon, and the percentage of offices in use is expected to increase
even as more space becomes available, Colliers said.

“The eventual opening of the insurance industry, along with the
further lib­eralisation of the financial sector is likely to drive
occupancy levels upward in 2017,” the researchers said.

“Colliers expects the government to start to streamline and expedite
investment approval pro­cess which should facili­tate the entry of more
for­eign companies. This will contribute to the rise in the overall
office take-up rate for the year.”